Sept. 11 (Bloomberg) -- Mitt Romney’s pitch to ensure that
sick people can obtain health insurance would draw the line well
before covering the estimated 65 million Americans with pre-existing conditions.

Romney, the Republican nominee for U.S. president, said on
NBC’s “Meet the Press” on Sept. 9 that he would preserve some
of the 2010 Affordable Care Act, including protections for
people with existing conditions. Romney’s proposal, which he has
made before without providing details, would apply only to those
who have been “continuously insured,” such as people who leave
a job with health benefits and then buy insurance on their own.

Keeping continuous coverage may be difficult because 89
million people, or more than one third of Americans younger than
65, were uninsured for at least one month, according to an Aug.
3 report from the Commonwealth Fund, a New York-based advocacy
group that analyzed data from 2004 to 2007. About 64 percent of
adults earning less than twice the poverty level have
experienced gaps in health coverage, which also may make them
ineligible for Romney’s plan.

“The fallacy is that you can look at the pre-existing
condition exclusions and turn that off, and that solves any kind
of problem,” said Linda Blumberg, a health economist at the
Urban Institute, a Washington-based policy research group.

The Commonwealth Fund’s study examined gaps in coverage
when the economy was relatively prosperous. The number of people
facing lapses is probably higher now, said Pamela Farley Short,
a professor of health policy and administration at Pennsylvania
State University.

Individual Mandate

“How many people would be helped or not helped by Romney’s
continuous coverage policy would depend on how long you would
have had to have been continuously insured in order to
qualify,” Short said in an interview. Romney hasn’t said how
long people would have to maintain insurance under his proposal.

The Affordable Care Act that President Barack Obama
championed takes a two-step approach to guaranteeing coverage
for sick people.

Beginning in 2014, the law prohibits insurers from denying
coverage or charging higher premiums to people who are sick and
buy policies for themselves or their families. The same year,
all Americans are required to have insurance unless they can
show they can’t afford it, under the so-called individual
mandate.

Court Ruling

The U.S. Supreme Court upheld the individual mandate as
constitutional on June 28. The Obama administration and the
health-insurance industry have maintained that the law’s
consumer protections can’t function without the mandate, because
people would wait until they get sick to buy coverage, a
phenomenon called “adverse selection” that may contribute to
higher prices and a destabilized insurance market.

“The reason the market’s so dysfunctional right now, or
really has failed to insure people when they need it, is largely
because of this adverse selection problem,” said Sara Collins,
vice president for affordable health insurance at the
Commonwealth Fund, which supported the 2010 health law.

As governor of Massachusetts, Romney signed into law a 2006
health overhaul that required most state residents to carry
insurance. People who don’t receive coverage at work can buy
policies, even with a pre-existing condition, through a state-run marketplace that the Obama administration has said was a
model for the exchanges in the federal law. Romney has distanced
himself from the state law since starting his campaign for
president and has said he would roll back the U.S. law.

Wrong Impression

“Governor Romney has made clear repeatedly that he will
repeal Obamacare in its entirety and replace it with patient-centered reforms that protect Americans’ access to care,” a
campaign spokeswoman, Andrea Saul, said in an e-mail.

Romney’s “Meet the Press” comments raised questions about
the details of his health-care policies going forward.

“There are a number of things that I like in health-care
reform that I’m going to put in place,” Romney said in the NBC
interview. “One is to make sure that those with pre-existing
conditions can get coverage.”

The show’s host, David Gregory, didn’t ask Romney to
elaborate on that statement, leaving the impression that the
candidate had endorsed a major provision of Obama’s health law.
Romney’s comments weren’t intended as new policy, Saul said.

Any replacement of the Affordable Care Act will ensure
“that people who have a pre-existing condition who’ve been
insured in the past are able to get insurance in the future so
they don’t have to worry about that condition keeping them from
getting the kind of health care they deserve,” Romney said in a
June 12 speech.

No Guarantee

The 1996 HIPAA law, the Health Insurance Portability and
Accountability Act, affords some protections to people who leave
a job with health insurance. Exiting workers with at least 18
months of continuous coverage must first enroll in a program
called Cobra, which temporarily extends employer-sponsored
benefits for workers who lose their jobs as long as they pay for
the premiums themselves.

Once they exhaust their Cobra benefits, usually after 18
months, workers are guaranteed the opportunity to purchase a
health plan that covers pre-existing conditions, Blumberg said.
Federal law is silent on how much that policy can cost.

“It does give some protections in terms of continuous
coverage, better than what was before, but there’s no guarantee
that it’s affordable,” Blumberg said.

Existing Law

Romney’s policy isn’t substantially different than existing
law, said Lis Smith, a spokeswoman for the Obama campaign.

“If he wanted to show leadership, he would stand up to
insurance companies, make tough, often politically unpopular
choices like the president did and stop all discrimination for
people with pre-existing conditions -- not just for those with
coverage, but for all 129 million Americans who have a pre-existing condition,” she said in an e-mail.

Smith’s figure is an Obama administration estimate of the
number of people with pre-existing conditions. Families USA, a
Washington consumer advocacy group that supports the health law,
reported a more conservative estimate, about 65 million, in
July.

HIPAA’s guarantee of protections against pre-existing
condition exclusions “didn’t really pan out very well,” said
James Capretta, a health policy researcher at the Ethics and
Public Policy Center who said he supports Romney and
occasionally advises the campaign. Capretta said he would rather
see a blanket rule letting people move seamlessly from employer-provided plans into policies they buy for themselves.

“Paying the full expense of Cobra coverage is a bit
daunting,” he said. “A lot of people aren’t even aware that’s
a requirement to retain this protection. So they end up not
doing it.”